By Nick Worth
The Holbrook City Council heard an overview of the proposed city budget, including the deletion of property tax, at a special work session Tuesday evening following the regular council meeting.
City Finance Director Randy Sullivan told the council the city is under a state-imposed spending limit of $6.8 million for fiscal year 2014-15. Sullivan’s budget calls for a total of a little over $10 million in expenses. There are $2.7 million in exemptions to the state limit, as well as the $500,000 spending override that will be up for voter approval on Tuesday, May 20.
With the override, depending on its success in the election, Sullivan is showing the city at $33,164 under the state limit.
“If the override passes, I’ll have that $500,000 in revenue and $500,000 in expenses,” Sullivan told The Tribune-News. “If it doesn’t pass, I won’t add it to the budget.”
Sullivan told the council that if the spending override fails to pass, there will be a total of only $120,000 available for street work.
“It will all go for crack sealing and road maintenance,” said City Manager Ray Alley, noting that no new road construction will be done if the override does not pass.
The election will ask voters to approve spending money the city already has. There are no new taxes being imposed.
In fact, one of the main points of Sullivan’s budget is the elimination of a property tax for next year.
“I’ll be taking about $52,000 out of revenues by doing away with the property tax,” Sullivan said.
The budget also shows projected city sales tax revenue of $3.15 million, up more than $150,000 from this year’s projected numbers.
According to Sullivan, state sales tax, urban revenue sharing and vehicle license taxes will also increase in the coming year. The state sales tax is expected to bring $456,581 to the city, while the urban revenue sharing and vehicle tax will bring in $611,661 and $275,838 respectively.
Because of the lowering of fees at the city swimming pool and ball fields, recreation income will decrease from the $13,000 shown in Sullivan’s budget, but he told the council he expects to gain $30,000 more in auction proceeds than the $6,000 he budgeted, because the city has a sanitation truck for sale.
The police department is seeing an increase of almost $320,000 in its budget, mainly due to jail fees doubling, said Sullivan.
The fire department is also due for an increase in its budget.
“I’m increasing the fire department’s budget by $32,000,” said Sullivan. “They need the extra money to buy new equipment, such as turnouts and a Jaws of Life.”
Sullivan also said he has transferred $507,000 to the water department, $400,000 of which is earmarked for payment on a bond. The rest is to be used for infrastructure improvements.
Budgeted general fund expenses for key city departments include: city council, $65,911; administration, $598,998; library, $208,646; parks and recreation, $446,318; golf course, $252,990; animal control, $72,210; police department, $2,016,743; fire department, $166,260; and fleet management, $141,501.
With the inclusion of lodgers, facilities/levee, airport, magistrate and senior center, the total general fund expenses come to just over $4.5 million. Utility expenses are budgeted at about $2.4 million, Highway User Revenue Funds at over $1.2 million and grants at a little more than $1.7 million, along with another $46,000 in other income, make the budget total of $10 million.
Sullivan said this is just the beginning of the budget process. He noted that the council will adopt the tentative budget on July 8, and there will be five more work sessions between now and then.
Correction
The original version of this article incorrectly state that the date for the override election was to be Monday, May 19.